Hi hi.....
Actually, my knowledge is only as an amateur car buyer. Its really
just common knowledge lah....er.....I'm not liable for any
extraordinary losses incurred hor? 
Generally its true that Singapore cars depreciate the most in the
first 3 years - and least in the last 3 years. Thus, if you plotted
a graph with car value (y axis) vs. time 0-10 years (x axis), you
will see a curve concave upwards. But there are some cases where
its not true (mainly due to over-ambitious pricing on the part of
the seller), so its best to examine each case individually.
You may want to check them out by surfing through used car websites
like www.sgcarmart.com
and
www.singaporeusedcars.com. From there, you will know
the resale values of the cars, COE and OMV values....and coupled
with the original prices, you can have a rough estimation of the
first 2/3-year depreciation.
Ok, as far as I can think, here goes......
PROS OF BUYING A NEW
CAR
- Prices are low now, so future depreciation will be low in terms
of cash value. It may depreciate the same percentage-wise, but
since the values are lower now, the same percentage depreciation
carries a lower dollar-value loss.
- Peace of mind because a new car will come with the warranties
(many offering 3 years now). With used cars, you may get some
serious defects due to accidents, rough use, etc. With used cars,
you will have to spend some money on repairs (change tyres,
servicing, timing belt, etc). There is a small percentage of new
cars which give unsolvable headaches too (eg. alignment, leakages,
strange sounds), but you've gotta be quite unlucky to get one of
those.
- There is no expensive transfer fee to pay, unlike when buying
used cars. To see how expensive transfer fees are, you can use your
own car example at this website:
http://www.psi.gov.sg/NASApp/tmf/TMFServlet?app=LTA-OSMC-ETF&isNew=true
(I think it should come up to almost $1k for a 2-year-old
Sunny).
- You can choose the options, colours, etc. With used cars, this is
usually limited. In fact, there are not many used Wishes in the
market - so you may have difficulties.
- New car distributors are usually much more professional and
easier to deal with than used car dealers (this is not always true
- just a very general statement).
- Your sweat will be the first to be absorbed by the seats. You'll
get the fresh new car smell.
PROS OF BUYING A USED
CAR
- Prices are low now if you buy a 2-3 year car. This is because the
first owner usually takes the most depreciation which occurs in the
first 2-3 years of the car's lifespan.
- Depreciation may be low now because (a) used car prices are
forced down by the low new car prices, and (b) cars of 2-3 years of
age have high COEs, maybe around $30k. So you'll be buying a car
with high-value COE at a low price.
- Used car prices are quite negotiable now due to low demand for
used cars. Even rich used car dealers can keep their cars for only
4-6 months max before they start getting into trouble (losing
money, legal matters like ownership change on paper, etc). They
don't always have the luxury of playing the waiting game, like we
(buyers) do. In fact, some have already started going
bankrupt.....(walk around Ubi Automobile Megamart and you'll know
what I mean).
- When buying a used car of, say, 3 years old.....you can actually
estimate the worst-case depreciation quite accurately (worst case
depreciation is when you have to scrap it). Because from the OMV
and COE values, you will know that the scrap value is at 5 years.
Thus, worst case depreciation = (buying price of 3 y.o car - scrap
value at 5 years) / 2 years.
- Minor defects may have been already done up by the previous owner
(that is, if he did it).
- The previous owner may have already installed some aftermarket
accessories - eg. glass tinting, reverse sensors, rims, leather,
aftermarket arm-rests, alarm and other security systems, etc.
- Waiting time is typically a few days, unlike new cars which can
take up to weeks for delivery.
- You don't have to go through the whole 10,000 km run-in period
again. I hate the run-in period, especially for performance
cars....because here you are driving a turbo car at slow speeds,
and outside uncles driving schoolbuses are all zooming past
you.
For me hor, when buying cars, the three most important things
are:
(a) I like the car.
(b) Condition of the car is good, if its a used car.
(c) After the above two are satisfied, then price is important. A
little difference in price to get what I want and what I think is
good is OK for me.
If you're looking for a car which is 2-3 years old, I would
recommend that you look for cars with only 1 previous owner. If
there was more than 1 owner in the first 2-3 years, I'd be a bit
suspicious. And try to allow a maximum of 25,000 km per year
(anymore than that MAY be considered high usage). And try to ensure
that that car's engine and exhaust systems are not modified. Most
important for auto cars, ensure that the gear is OK (these are VERY
expensive parts to repair/replace).
If you should decide on a new MPV and don't care much about
power/acceleration, the Toyota Isis seems quite nice. I saw one
that day, but its only available from the parallel importers (you
can't test drive it). Another good one which I test-drove recently
is the new Mazda 5 (you can test drive it at Mazda's MacPherson
showroom). Both should be around $80k now.
Toyota Isis:
http://www.toyota.co.jp/jp/tech/new_cars/isis/presentation/index.html
Mazda 5: http://www.mazda.com.sg/mazda5/index.html
